SS10.E.10

Social Studies (2010) Grade(s): 12 - Economics

SS10.E.10
Explain the structure, role, and functions of the United States Federal Reserve System.

Unpacked Content

Knowledge

Students know:

The functions of money: medium of exchange, unit of account (measure of value), and store of value.
The role of the Federal Reserve in the United States' economy.
The 3 primary monetary policy tools: reserve ratio, discount rate, and open market operations to influence the federal funds rate.
How the 3 primary monetary policy tools impact the money supply and the overall economy.

Skills

Students are able to:

Determine the specific economic impact of changes in the reserve ratio.
Determine the specific economic impact of changes in the discount rate.
Determine the specific economic impact of open market operations on the federal funds rate.
Determine the appropriate monetary policy to promote employment.
Determine the appropriate monetary policy to combat inflation.

Understanding

Students understand that:

Money functions to increase trade.
Monetary policy tools are used to promote employment and economic growth.
Monetary policy tools are used to combat inflation.
The Federal Reserve has a role in controlling the money supply.

Vocabulary

monetary policy
reserve ratio (reserve requirement)
fractional reserve banking
discount rate
deposit multiplier (deposit expansion
multiplier /simple money multiplier)
open-market operations
federal funds rate
easy-money policy (expansionary)
tight-money policy (contractionary)

Aligned Learning Resources

Monetary and Fiscal Policy: Crash Course Government #48

Design by Adaptive Theme